• Estate and Future Planning

    Families often feel overwhelmed by the daily issues and challenges they face in caring for their child with special needs. While it is difficult to look ahead, it is extremely important to plan now for the financial future of your child. Maintaining eligibility for state and federal government benefit programs beyond the age of 18 is an important part of utilizing resources for maximum support. Parents and other caregivers need to understand the implications of their current financial and legal decisions on their child's future.

    The Complex Care Center at Cincinnati Children's provides information to patients and families to assist in estate and future planning.
  • Parents and other family members often want to put money aside to provide lifetime care for their child with special healthcare needs. As parents age, it may be more difficult for them to provide care. In addition, the individual with a disability may want to be more independent. Having assets in the name of the children with special healthcare needs, regardless of age, often disqualifies them from important government programs including Medicaid and Social Security.

    Luckily there are special estate planning techniques that can be used to protect your child from losing government assistance. As part of estate planning, families should look into establishing a special needs trust for the care of the child with a disability. If done properly, these could still provide the necessary funds to help the individual without disqualifying them from government programs. Funds may also be used earlier in the child's life for such needs as home or vehicle modifications without affecting eligibility for state programs. They can pay for things not covered by government benefit programs, including entertainment, trips and vacations, computer equipment, education, recreation and other items that can add to the individual's quality of life. Any approach should be carefully discussed with a knowledgeable attorney to see what would work best in your situation.

    It is often recommended that parents take the time to decide what kind of future life they would like for their child and then describe it in a letter of intent to be included in their estate planning documents. The letter can address their hopes and dreams and reflect what they want for their child in all of the major life areas including living arrangements, child's likes and dislikes, recreation, social and community interests. While not legally binding, the letter can help the future caregiver gain an understanding of the family's vision. The letter of intent can include:

    • Medical history of the child including doctors, allergies, medications and any other health related information
    • Housing preferences
    • Daily needs, life skills and personal care needs 
    • All About Me Form can help share information about the child's likes, dislikes, activities, friends and special interests
    • Hopes and dreams that the family has for the child's future

    Share the letter with family members and trusted friends to help build support around your vision. Review the letter on a regular basis and keep it updated to reflect your child's needs and your changing goals.

    When set up properly, a special needs trust can provide the funds to supplement, not replace, government funded benefits. It is critical that you discuss your options and set up a special needs trust with a qualified attorney. The special needs trust provides the ability to pay for items and services beyond the basic necessities of medical care, room and board, employment, basic personal needs, care and supervision funded by government benefits programs. Funds from the special needs trust can be used to provide enrichment, such as recreation, trips, electronic equipment, gifts, medical / dental expenses not covered by Medicaid, and other personal expenses. For example, if your child's computer or television broke, money to purchase replacements could come from the special needs trust. If your child enjoys going on vacations, this too could be paid for by the trust. There are several sources of information that can help you:

    Congress passed a law creating a new type of savings plan for your loved one who has a severe disability. The “Achieving a Better Life Experience (ABLE) Act” was “designed to provide new opportunities for individuals and families to save for the purpose of supporting individuals with disabilities in maintaining their health and independence.” 

    Beginning January 1, 2015, the ABLE Act authorizes each state to establish and operate ABLE programs, similar to the college planning 529 account. The program allows:

    • A single ABLE account to be set up for any “eligible” state resident. “Eligible individuals must be severely disabled before turning age 26, based on marked and severe functional limitation or receipt of benefits under the SSI or Disability Insurance programs.”
    • An annual contribution to the ABLE savings account to be made, from all individuals, equal to the annual gift tax exclusion amount (in 2014-2015 this is $14,000, but is indexed for inflation).
    • Distributions are taken directly from the ABLE account and can be used for “qualified expenses.” These are defined as expenses related to the individual’s disability, such as:
      • health
      • education
      • housing
      • training
      • assistive technology
      • personal support
      • related services and expenses
    • Any income earned by these accounts would not be taxed, nor would distributions made from them, so long as the distribution is used for qualified expenses. 
    • The accounts will not be considered a resource when determining eligibility for government benefits (up to $100,000 of the ABLE account value). However, distributions for housing expenses would still be considered when SSI benefits are calculated.

    An ABLE account provides a way to help provide a better quality of life for a loved one with a severe disability, and does not jeopardize government benefits being received. Under this new legislation, each state is enabled to create an ABLE 529 account.

    The ABLE National Resource Center (ANRC), founded and managed by the National Disability Institute (NDI), provides information concerning the benefits of an ABLE account. ABLE accounts are tax-advantaged savings accounts for individuals with disabilities and their families, to be created as a result of the passage of the Stephen Beck Jr., Achieving a Better Life Experience (ABLE) Act of 2014. The ANRC aims to educate individuals with disabilities and their families and other stakeholders about ABLE’s potential positive impact on the lives of millions of Americans with disabilities.

    While government agencies recognize special needs trusts, they have developed complicated rules and regulations. Special expertise is required in estate planning because laws affecting individuals with disabilities can change frequently. This is why it is critical that you consult an attorney experienced in estate planning for families who have a child with special needs, not just one who does general estate planning. One wrong word or phrase can make the difference between an inheritance that really benefits the person with a disability and one that causes the person to lose a wide range of needed government services and assistance. Don't be afraid to interview special needs attorneys and ask questions before deciding who would be a good match for your individual situation:

    • Is special needs the main area of the practice?
    • Does the attorney have a proven record of designing and implementing special needs trusts?
    • How many special needs trusts has the attorney written?
    • Is the attorney thoroughly knowledgeable about current government benefit programs including SSI and Medicaid?
    • Is the attorney familiar with recent developments and changes in disabilities laws and regulations?
    • Does the attorney have a strong understanding of the language used by special needs professionals?

    To find a lawyer who specializes in special needs estate planning, you can check with your local disability organizations, advocacy agencies and other parents. Don't select an attorney based only on someone's recommendation. Be sure to interview and ask questions before you decide. It is important to do your homework and select an attorney that specializes in special needs trusts. There are several resources that can help get you started: 

    • Community Fund Management Foundation is a nonprofit, tax-exempt organization created to establish and administer trust programs for Ohio residents with disabilities. The trust enables individuals who are disabled use private funds to enhance their quality of life while safeguarding their eligibility for government benefits. They can recommend attorneys to help you establish funds through the trust.
    • PLAN of Southwest Ohio, Inc. can provide a referral to an attorney experienced in developing special needs trusts.
    • Martindale-Hubbell lists and provides descriptive information and ratings on law offices.
    • Academy of Special Needs Planners provides information and links to member attorneys in each state.
    • Special Needs Alliance is a national organization of attorneys dedicated to the practice of disability and public benefits law. Individuals with disabilities and their families can be connected with nearby attorneys who specialize in disability law. They can provide assistance with estate and future planning, special needs trusts, guardianship and Medicaid and SSI eligibility.

    Cincinnati Children's does not endorse specific attorneys. It is important to thoroughly research and ask questions before you select an attorney specializing in special needs trusts. To help with your information gathering, several Cincinnati area attorneys include general estate planning and special needs trusts information on their websites:   

    • Richard B. Dusterberg has helpful information on special needs trusts and estate planning.
    • Patricia Laub
    • Chad S. Levin is a partner with Kohnen & Patton LLP and concentrates his practice in the areas of estate planning, elder law, special needs planning, and Medicaid eligibility planning.  Mr. Levin has over twenty years of experience representing and advising families in the special needs planning area, including with respect to third-party and first-party special needs trusts, Medicaid pooled trusts, powers of attorney and advance health care directives, guardianships, and Medicaid eligibility planning, applications, and appeals.  Mr. Levin is certified by the Ohio State Bar Association as a Specialist in Estate Planning, Trust, and Probate Law, and is a member of the Cincinnati Bar Association (Treasurer, 2012-2015, Estate Planning and Probate Committee, Elder Law Committee), Northern Kentucky Bar Association (Past Treasurer), Ohio State Bar Association (Estate Planning, Trust & Probate Section, Elder and Special Needs Law Committee), Kentucky Bar Association, and Cincinnati Estate Planning Council, and also serves on the board of trustees of Pro Seniors, Inc.  Mr. Levin is licensed to practice law and actively represents clients in both Ohio and Kentucky.
    • Mark Reckman of Wood & Lamping, LLP
    • William Sherman and Thomas Gaier of Robbins, Kelly, Patterson & Tucker
    • James A. Singler is a partner with Calfee, Halter & Griswold LLP and works with clients in the areas of estate planning, probate and trust administration, taxation, wealth transfers, business succession planning, planning for children with special needs, Medicaid planning and elder law issues. He is also an Adjunct Professor of Estate Planning at the University of Cincinnati School of Law. Mr. Singler is a member of the Cincinnati Bar Association, Ohio State Bar Association, Federal Bar Association, American Bar Association and the Cincinnati Estate Planning Council. He serves on the Board of Directors of the Cincinnati Estate Planning Council. He was a member of the Board of Trustees for the National Multiple Sclerosis Society and has served on the Boards of the Down Syndrome Association of Greater Cincinnati, the Mariemont School Foundation and Family Service of Cincinnati.
    • Janet E. Pecquet at Beckman Weil Shepardson LLC
  • Contact Us

    We want to hear from you. Email us with your feedback or suggestions for additional resources. Call our Family Resource Center at 513-636-7606 with your questions.